Healthcare law on the ballot

Ezra Klein is right. In a recent Washington Post column, the left-leaning policy wonk laid plain that the future of ObamaCare is at stake in next week’s elections. If President Obama wins and Democrats hold the Senate, the Affordable Care Act will survive. If Mitt Romney wins and Republicans take the Senate, the law is dead. It is the starkest of differences.
 
How likely is each scenario? At this moment Democrats have the advantage. According to Real Clear Politics, the president is running slightly ahead in six out of ten battleground states. He could actually lose seven of these, but still be reelected if he hangs onto Ohio, Wisconsin, and Iowa.

While key Senate races have tightened, such as Tommy Thompson in Wisconsin, Democrats have a slight advantage there too. If the elections were held today, Republicans would fall two seats short.
 
What would this future look like?  Implementing ObamaCare would be accelerated. HHS and states will have less than fourteen months to finalize major provisions of the law before they take effect on January 1, 2014.
 
Thousands of pages of regulation will be released shortly after the election, on everything from IRS rules for employers to essential health benefits to covering pre-existing conditions. It remains to be seen how prescriptive these regulations would be.
 
State officials will have to submit a blueprint for their insurance exchanges by November 16th. They will need to decide if they will create and exchange and how it will be designed.
 
They will also have to decide whether to expand their Medicaid programs, and they’ll need to determine essential health benefits and benchmark plans for the insurance options to be sold through their exchanges.
 
Hospitals will brace for additional Medicare reimbursement cuts, while at the same time prepare for a huge increase of newly insured patients with pent-up demand for medical services.
 
Facing a plethora of new requirements, rules, and potential financial penalties in 2014, businesses will look differently at the future of employer-sponsored insurance. Businesses will continue to shift away from defined-benefit plans to defined-contribution plans.
 
Many will weigh the costs and benefits of offering health benefits at all. Relatively few will stop offering coverage in 2014, as those decisions will need to be made next spring, but over time this shift will undoubtedly occur, adding more costs to government programs.
 
The alternate scenario in 2013 after a Republican election sweep couldn’t be more different.
 
A fierce political battle on par with the original debate over ObamaCare would ensue. Democrats fought for national health reform for decades, and would fight tooth and nail to save it.
 
However, the tables would be turned. The power of single-party rule Democrats enjoyed in 2009 to pass ObamaCare would now be wielded to bring it down.
 
Republicans would not have sixty votes to pass a full-out repeal of the law, but they would have a simple majority to gut the law through budget reconciliation.
 
Reconciliation prohibits the inclusion of legislation that is “merely incidental” to the budget, but any provision that does have a significant impact on the budget could be. And ObamaCare has many, given its nearly $2 trillion price tag.
 
Provisions that would be targeted for elimination include the Medicaid expansion, the individual mandate tax, subsidies, insurance exchanges, industry fees, Medicare cuts, and new taxes in the law.
 
Others may be included as well, such as funding for the CMS Innovation Center and the Prevention and Public Health Trust Fund. Perhaps even provisions like covering pre-existing conditions and community rating, which would equalize premium costs across a wide geographic area, could also be included. 
 
What’s allowed in a reconciliation package would ultimately be determined by the Senate President, Paul Ryan, with counsel from the parliamentarian.
 
Implementation at the state level would halt. There would be no need to continue considering the law would cease to exist, though some may continue reforms at the state level.
 
Whichever scenario the voters choose next week will bring significant change. We will either move to a federally-dominated healthcare system, or we will step away from that precipice and pursue different reforms. Either way 2013 will be an interesting year.
 
Merritt has been a health policy adviser to three presidential campaigns. He is a managing director at Leavitt Partners, the healthcare firm led by former HHS Secretary and Utah Governor Mike Leavitt.

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